President Trump has announced that the U.S. has reached a trade deal with Vietnam following weeks of negotiations.
- The resulting trade parameters include a 20% tariff on Vietnamese exports entering the U.S. and a 40% tariff on goods deemed to be transshipped through the country to the U.S.
- Trump had initially levied a 46% “reciprocal tariff” on Vietnam in April before temporarily lowering that to 10% in order to negotiate with the country. The deadline to reapply that 46% tariff was July 9.
According to Trump, the Asian country will no longer apply tariffs for American imports entering Vietnam.
RELATED: Pros And Cons Of Sourcing From Vietnam
Promo Perspective
In recent years, Vietnam has become a common trade partner for sourcing materials within the promotional products industry. Even before Trump took office and began a trade war with China, it was considered a potentially viable alternative to sourcing from the global trade giant for ethical or practical reasons.
“Vietnam’s textile industry is one of the world’s largest, exporting approximately $40.3 billion in 2023. Known for its quality and affordability, Vietnam’s garment factories produce everything from sportswear to high fashion, making it a key global hub for apparel sourcing,” said Ricky Ho, co-founder and CEO of SourceReady, an all-in-one AI-powered product sourcing platform.
- Brands that successfully manufacture in Vietnam include Lululemon, Nike and LEGO.
Perspectives on this new deal may vary. Some degree of long-term certainty is surely welcome, and the originally proposed 46% tariff might have made trade with Vietnam untenable for many. However, those who had been doing trade with the country during the pause will see their tariffs on Vietnamese imports double, which may have a ripple effect.
Alok Bhat
Senior Manager of Research & Advocacy, PPAI
“With Vietnam being a key alternate sourcing hub for promo, this could raise costs and disrupt supply chains,” says Alok Bhat, market economist and PPAI’s research and public affairs lead.
